An Interview with an Electronics Recycling Business Leader
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The Sustainable Enterprise Report spoke with Jade Lee, the president of Supply-Chain Services, Inc. (SSI) of Lombard, Ill., which describes itself as “the best-in-class leader in the electronic recycling and reverse logistics industry.” SSI provides a single-source reverse supply-chain solution for corporate customers.
After receiving an MBA from Northwestern University, Lee worked over ten years at Baxter Healthcare International in sales and marketing management. Under her leadership, SSI has transformed into a value partner, delivering integrated solutions in the entire reverse supply-chain arena. She is an author and a board member of the International Association of Electronics Recyclers (IAER).
Q: Could you explain the electronics recycling market and why it’s so important for the sustainable enterprise?
A: The electronics recycling industry has evolved to become a very critical part of the corporate sustainability management program. For many corporations, the dynamics of doing business have drastically changed. In addition to addressing financial performance, today’s corporation also has to address sustainability and environmental management issues. As a result, reverse logistics and recycling have become an integral part of this trend. Corporations have to tell their shareholders or customers that a sustainability management system is in place, which includes responsible disposition of end-of-life equipment. In the past, the electronics recycling industry was just a small part of corporate operations, but recently it has emerged to become an issue the CEO must address.
Q: What are the different types of recyclers in the industry?
A: There are about 500 electronics recyclers in the United States, but most focus on refurbishing computer equipment and resale. This type of recycler is called a technology value recovery service provider. Our company is a different breed, as we provide a much broader spectrum of services. In addition to value maximization services, we also provide product return management services (reverse logistics), product take-back management services and de-manufacturing services for original equipment manufacturers (OEMs). The type of equipment we handle is way beyond IT equipment. To us, anything with a plug can be recycled. In optimal value recovery, we share remarketing revenue with customers after performing tasks in auditing, testing, data sanitization and refurbishing. On the de-manufacturing side, there is usually a cost for the services, because significant labor is involved in de-manufacturing equipment and managing all recyclable materials generated during the process.
It’s important to manage what we call “focus materials” or “special waste,” such as batteries, cathode ray tubes (CRTs), circuit boards, lamps and toners. These materials may contain hazardous components. It’s critical that the service provider manage all type of materials in an environmentally responsible way. We think strategically at high levels, whereas most recyclers focus primarily on dealing with materials or reselling equipment. We believe it’s important to ask the strategic goals of our customers to help them be sustainability leaders.
SSI is the only recycler that has built into our information system an automatic calculation of GHG (greenhouse gas) reduction numbers. CEOs cite our audited numbers when addressing shareholders and customers. Also, we’re not just a recycler, we’re an electronic recycling management company. We’ve set up a solid global infrastructure to manage our customers’ electronic recycling needs. SSI may not be the largest provider, but we are the most sophisticated and forward-thinking one.
Q: In terms of e-waste, Europe is leading the way. How are you seeing legislation and policy changing in the United States?
A: Legislation has significant impact on the industry. At present there are no specific U.S. federal laws governing disposition of electronic waste. However, the EPA published an important CRT rule that went into effect Jan. 29, 2007, requiring all recyclers to follow certain requirements. If intact or broken CRTs are sent to foreign countries for recycling, the exporter must send notification to EPA. EPA forwards the notice to the receiving country, which must consent in writing to receive the CRTs before shipping. If any recycler sends intact CRTs to foreign countries for remarketing or re-use, they have to be tested, functionally working units. Exporters must also send a one-time notification to their EPA regional office. EPA has penalized recyclers with fines for violating CRT rules. Therefore, it is important for corporations to require their recyclers to show evidence they adhere to EPA CRT rules.
In view of the absence of a national e-waste law, seventeen states have passed their own e-waste regulations. Previously, our industry focused on servicing OEMs, corporate customers or governmental customers. Now we have to come up with different strategies to address collection from the general public. This has opened up business opportunities. Many thought they could easily enter the electronics recycling industry. About two years ago, EPA organized a committee to develop the best management practice standards for electronics recycling. The committee is dubbed R2 (Responsible Recycling). I had the honor of representing the recycling industry in the R2 small group. R2 standards require recyclers to have an environmental management system in place and understand how to manage all types of materials, especially “focus materials.” We have to perform due diligence on downstream material processors or service providers two levels deep. It’s also mandatory that recyclers adhere to all pertinent international and U.S. laws, have export control management, data security management, and health and safety systems in place. We believe once R2 standards are finalized, they will change the dynamics of the whole industry by setting a much higher bar. On the other hand, customers will feel more confident in utilizing the services of R2-certified recyclers.
Q: Are there some nuggets of information that companies should bear in mind when selecting an electronics recycler?
A: Yes. I think the most important thing is to find out if there is an environmental management system in place, and if they have certifications, such as ISO 14001. For example, my company is the only recycler that has attained four key industry certifications. ISO 14001 is an environmental management system; ISO 9001 is a quality management system. The certification issued by the International Association of Electronics Recyclers (IAER) is more stringent than ISO 14001 because it demands downstream due diligence, focus materials management, export control management, data security management, health and safety systems, and financial stability. We were recently awarded an Electronic Data Sanitization and Destruction Certification from the National Association for Information Destruction (NAID). It’s a very stringent certification focusing on the important emerging issue of electronic data security and facility security.It is critical to select a best-in-class service provider with ISO, IAER and NAID certifications.
